Principles of Management 420
Maslow's Hierarchy of Needs
(level 1) Physiological Needs, (level 2) Safety and Security, (level 3) Belongingness - Relationships, Love and Affection, (level 4) Esteem (Internal and External), (level 5) Self Actualization
Benefits of starting a business from scratch
- Avoids problems associated with previous owners - Freedom to choose suppliers, equipment, location & workers
Reasons for failure of a business
- Managerial Incompetence - Insufficient funds - Weak Control Systems - Growing too fast - Lack of commitment - Ethical failure
Big Five Model of Personality
1. Agreeableness 2. Conscientiousness 3. Emotional Stability 4. Extraversion 5. Openness to new experiences
HR Planning Steps
1. Assess current HR (number and skills) 2. Assess future HR needs 3. Developing program to match resources with needs
The legal environment of HRM
1. Equal Employment Opportunity Laws 2. Compensation and Benefits Laws 3. Labor Relations Laws 4. Health and Safety Laws
Reasons for Success
1. Hard work, drive, and dedication 2. Careful analysis of market conditions 3. Managerial competence 4. Luck
8 Entrepreneurial Personality Traits
1. Internal Locus of Control: strong belief that we control our own destiny 2. High need for achievement; goal-oriented 3. High level of energy 4. Moderate risk taker- only takes informed, calculated risks 5. Self-confidence 6. Action-oriented 7. Desire for Independence; wants to be his/her own boss 8. Flexibility; willingness to change a course of action if necessary
Job satisfaction influenced by 3 groups
1. Personal factor 2. Group factor 3. Organizational factor
HRM Process
1. What laws and regulations shape the HRM practices? (legal environment) 2. What are my HRM needs? (HR Planning) 3. Where can I find qualified job candidates? (Recruit Processes) 4. How can I choose the best? (Selection techniques) 5. How can I ensure employee skills are current? (training) 6. Best way to evaluate an employee's performance (PA) 7. What options exist to handle over-staffing? (Decruitment process)
Why has Entrepreneurship Increased in Popularity?
1. downsizing of large corporations 2. crossovers to small businesses by former large business employees 3. increased options in franchising 4. the emergence of E-commerce 5. increased entrepreneurial opportunities for minorities and women 6. better survival rates for small businesses 7. technological advances 8. Economic freedom 9. Social Entrepreneurship: people interested in resolving social/economic issues (i.e. poverty, pollution, etc.)
Percentage of how many new businesses fail and within how long?
60 to 80 percent of all new businesses fail within their first 5 years of operation
locus of control
A belief about the amount of control a person has over situations in their life.
Equal Employment Opportunity Commission
A federal agency charged with enforcing Title VII as well as several other EEO laws such as the Age Discrimination Act, the ADA, the Equal Pay Act and the Pregnancy Discrimination Act. The EEOC handles employee claims of discrimination and implementing new anti-discrimination laws.
self-efficacy
A person's belief about his/her capabilityto perform a task. Very task-specific personality trait (not the same as self-esteem, which is much more general)
Extraversion
A person's comfort level in social situations
What is the Proactive Personality Scale?
An instrument that research has proven to be a very accurate way of measuring a person's likelihood of becoming an entrepreneur
Content Perspectives on Motivation
Approaches to motivation that try to answer the question, "What factors in the workplace motivate people?"
How old are most Entrepreneurs?
Between 22 and 45 years old. With age comes experience
3 attribution factors
Consensus, Consistency, Distinctiveness
Bona Fide Occupational Qualification (BFOQ)
Criteria for employment that can be clearly justified as being related to a person's capacity to perform a job. needs to be criteria related to the job.
What is a business plan?
Describes the direction for a new business and the financing needed to operate it. A hybrid document; part pragmatic (feasibility study) and part sales tool (to secure financial resources). A clear, concise, realistic (especially for the financial projection) and detailed (especially the market and competitive research)
The Role of Entrepreneurship in our Society
Employ some 55 percent of private workers Receive 35 percent of federal government contract dollars Provide as many as 6 out of every 10 new jobs in the economy (Management by Schermerhorn, 12th Edition, pg. 144)
Goal Setting Theory
Employees will be motivated by goals that have 4 characteristics: Difficulty, Specificity, Acceptance, and Commitment
Equity Financing
Exchanging ownership for outside investment monies (e.g. venture capital firm). Don't have to pay them back because they have become co-owners
Reinforcement Theory
Explains the role of rewards as they cause behavior to change or remain the same over time
True or False: Money is the key to entrepreneurial success.
False. Many started with very little money
True or False: High levels of job satisfaction lead to high job performance
False. high levels of job satisfaction DO NOT necessarily lead to high job performance
True or False: You have to have a degree in Business to be an Entrepreneur.
False. knowledge helps, but it's not a pre-requisite.
True or False: Entrepreneurs are born, not made.
False. talent + experience gained = success
True or False: Entrepreneurs are gamblers.
False. they only take calculated, moderate risks
Equity Theory
Individuals equate value of rewards to effort and compare it to other people
Selection
Involves gathering and assessing information about job candidates and making decisions about whom to hire
Negative part of starting a business from scratch
More risk and uncertainty
Benefits of buying an existing business
Odds of success are better: - The business has a proven ability to draw in customers and make profit - Networks (e.g. customers and suppliers) are already established
5 parts if writing a business plan
Part 1: Description of the business Part 2: Marketing Plan Part 3: Production/Operations Plan Part 4: Management Plan Part 5: Financial Plan
Machialvellianism
Personality traits involving the willingness to manipulate others for one's own purpose. Behavior directed at gaining power and controlling the behavior of others. it is a personality type oriented toward manipulation and control with low sensitivity to the needs of others. research shows that there is no connection between this and marital status or intelligence; men are more machiavellian than women; younger people more mach. than older people; business students more mach. than others 😣
selective perception
Screening out information that causes discomfort or that contradicts his/her beliefs
Replacement Chart
Succession Plan; a database of managerial positions, who occupy them now, how long they will probably stay and who is or soon will be qualified to move into these positions
Conscientiousness
The ability to follow through, be detail-oriented and self-disciplined. It is a measure of reliability (the ONLY dimension to be positively correlated with performance for all occupations).
external locus of control
The belief that one's fate is outside his/her control
Recruitment Process
The process of attracting the right people to apply for jobs in an organization. It can be done externally by recruiting candidates who are not part of the organization, or internally by promoting existing employees into new positions within the organization
Human Resource Management
The process of attracting, developing, and retaining an effective workforce.
effective communication
The process of sending a message in such a way that the message received is as close in meaning as possible to the message intended
Communication
The process of transmitting information from one person to another
Alderfer's ERG Theory
The theory that three universal needs—for existence, relatedness, and growth—constitute a hierarchy of needs and motivate behavior. Alderfer proposed that needs at more than one level can be motivational at the same time.
Personal resources for financing a new business
Using your own money and money borrowed from friends/family
Distinctiveness
When a person behaves the same in other situations. Example: if he/she is late to everything it's internal, if not, high distinctiveness; external factor
Consistency
When a person similarly behaves in the same situations overtime. If behavior is consistent, then it's internal, if not then it's external. Example: when a person is consistently late it's internal (something going on with the person), if it's inconsistent for him/her to be late, it's an external factor like bad road conditions
HR planning
When management ensures that it has the right number and mix of workers needed to meet the organizational goals.
Initial Public Offering (IPO)
When shares of stock in the business are first sold to the public and then begin trading on a major stock exchange
Process Perspectives on Motivation
Why people choose certain behavioral options to satisfy their needs and how they evaluate their satisfaction after they have attained their goals
Employee Information System (Skills Inventory)Co
a database of employees' education, skills, work experience, and career expectation that is used to identify individuals who are ready for a promotion or a transfer; usually computerized.
collective bargaining
a group process of negotiating work-related issues with the anticipation of coming to an agreement. Bargaining or negotiating is done between 2 parties: the employer and the employees.
openess to new experience
a person's range of interests and reaction to change, uncertainty and the unknown
Attitude
a predisposition to react in a certain way towards people and things in a certain way
Organizational Commitment
an attitude that reflects an individual's identification with and attachment to an organization
Job Satisfaction/Dissatisfaction
an attitude that reflects the extent to which an individual is gratified by or fulfilled by his/her work
Agreeableness
an individual's propensity to get along with others, to go along without complaining
Stereotyping
categorizing or labeling on the basis of a single attribute (like race for example)
Specificity
clarity and precision of the goal
Growth Needs (ERG)
desires for continued personal growth and development
relatedness needs
desires for good interpersonal relationships
existence needs
desires for physiological and material well-being
Behavioral Interview
explore what applicants have actually done in the past
commitment
extent to which an individual is personally interested in reaching a goal
Acceptance
extent to which persons accept a goal as their own
Occupational Safety and Health Administration (OSHA)
federal agency which regulates the safety of workers from job-related accidents and diseases
Situational interview
focuses on hypothetical situations and asses how the candidate reacts to them
Debt Financing
funds raised through various forms of borrowing that must be repaid (e.g. loan from a bank)
3 expectancy factors
i. Effort to performance expectancy or expectancy ii. (E) is the probability that effort will lead to performance iii. Performance to outcome expectancy or Instrumentality(I) is the perception that performance leads to an outcome. Outcome is the consequence or reward for performance. iv. Attractiveness or valence(V) is how much a particular outcome/reward is valued. M = E•I•V; A zero at any part of this equation will result in zero motivation
structured interview
involves asking each applicant the same questions and comparing their responses to a standardized set of answers
unstructured interview
involves asking probing questions in a free-flowing style to find out what the applicant is like
Expectancy Theory
motivation depends on how much we want something and how likely we are to get it
Negative part of buying an existing business
new owners inherit the business's existing problems
Adverse Impact
occurs when minority group members pass a required selection standard at a rate of less than 80% of the majority group.
Selection Techniques
reliability and validation
Job Forecasting Tools
replacement chart (succession plan), employee information system (skills inventory)
progression principle
states that a need isn't activated until the next lower-level need is satisfied
deficit principle
states that a satisfied need no longer motivates behavior
positive reinforcement
strengthens a behavior by providing a desirable consequence
Avoidance (negative reinforcement)
strengthens behavior by allowing escape from an undesirable consequence
Emotional Stability
taps a person's general mood and emotional state as well as a person's ability to withstand stress. Ability to control emotions such as anger, anxiety, depression; impulse control
internal locus of control
the belief that you control your own destiny
Difficulty
the extent to which a goal is challenging and requires effort
Authoritarianism
the extent to which a person believes that power and status differences are appropriate within hierarchical social systems such as organizations
Validity
the extent to which a selection device is really predictive of future job performance. There is a proven relationship between the selection device used and some relevant job performance measure.
Reliability
the extent to which a selection device measures the same characteristic consistently
Self-Esteem
the extent to which an individual believes he/she is a worthwhile individual
person-job fit
the extent to which the contributions made by the individual match the inducements offered by the organization
Psychological Contract
the overall set of expectations held by an individual with respect to what he or she will contribute to the organization and what the organization will provide in return. It is an exchange defined in terms of contributions and inducements.
The Motivation Process
the process of moving from need to motive to behavior to consequence to satisfaction or dissatisfaction
Entrepreneurship
the process of starting a new venture, organizing and managing, and assuming the risks and awards
Perception
the process through which people receive, organize, and interpret information from the environment
Personality
the relatively stable set of psychological and behavioral attributes that distinguish one person from another
Motivation and its relationship with Performance
the set of forces within an individual that account for the level, direction, and persistence of effort spent at work; the intensity of a person's desire to engage in some activity. Leads to an effort which when combined with the ability needed to do the job and the resources needed, results in performance.
Punishment
weakens behavior by providing an undesirable consequence
Extinction
weakens or eliminates behavior by not providing a desirable consequence; can also weaken a behavior by ignoring behavior in hopes of it going away over time, or by removing any reinforcement that's maintaining the behavior
consensus
when others in the same situation behave the same. Then you can say the behavior shows consensus and its attribution is external. example: everyone's late because of a car accident or bad road conditions
attribution theory
when we observe behavior and attribute a cause to it (external or internal)